CEO Larry Cuculic talks about growing WorldHotels, the company’s new
extended-stay brand, growth in India and staying ‘sticky’ in the customer
journey.
Editor’s note: Read Part 1 of
this interview with Larry Cuculic, discussing why he likes the company’s unique
model, future growth plans and driving conversions.
PHOENIX
— The CEO of BWH Hotels thinks soft brands are vital to his company’s future
growth because of the “independence” they allow hotel owners to maintain.
“We
will continue to grow our soft brands as hotels want to maintain their
independence,” said Larry Cuculic, president and CEO of Phoenix-based BWH
Hotels. “It’s almost that next generation of developer, who want to do it their
way and maybe have less constraints placed upon them as to what a successful
hotel should look like.”
Cuculic
said BWH’s members (the company has a unique membership model that works
differently than the traditional hotel franchise method) like the company’s
many soft brand options because they “allow their personality to come through.”
“This
is a little-known fact, but Best Western is the world’s second-largest
soft-brand company,” he said.
The
number of soft brands for BWH is plentiful, including the SureStay Collection
in economy, BW Signature Collection in upper midscale, BW Premier Collection in
upscale, Aiden in upscale boutique, and WorldHotels in the upper upscale and
luxury segments.
WorldHotels growth
BWH
Hotels acquired WorldHotels in 2019 to enhance its offering in the upper
upscale and luxury segments. Cuculic said the brand represents a tremendous
opportunity for growth.
“Each
of them has this unique characteristic or experience that allows them to
connect with travelers and provide that experiential travel,” he said.
Cuculic
said this is a great fit for BWH because it gives members more freedom to
decide what will work in their communities. He brings up examples as diverse in
style as The Collector in The Hague, Netherlands; b’mine hotels in Germany; the
Alhambra Palace Hotel in Granada, Spain; and the Daxton Hotel in Birmingham,
Michigan.
“It’s
this diverse portfolio of properties where the sum is greater than the
individuality of their parts because they’re all so different and unique, but
they fit in really well with us,” he said.
Cuculic
said when BWH bought WorldHotels, there were about 10 hotels in North America.
That number has now grown to 25 and 160 worldwide.
He
said he wants the soft brand to grow by about 50 properties annually.
New extended-stay brand
BWH’s
newest brand, @HOME by Best Western, is competing in the crowded midscale
extended-stay segment.
The prototype allows the developer to determine what’s best suited for that location.
Larry Cuculic
Cuculic
said the company is currently incentivizing its growth with its members and
aggressively planning for the brand in suburban, secondary markets where the
developers see the demand drivers.
“The
concept is they have the economics of being an extended-state property with
less labor… So, it’s got a business model that is well suited right now about
labor challenges,” he said. “But it also leverages infrastructure spending and
group business and business travel where they stay longer than two to three
days.”
Cuculic
said the prototype for @HOME gives the developers a lot of flexibility.
“The
prototype allows the developer to determine what’s best suited for that
location,” he said. “It doesn’t have to have a swimming pool, a meeting room… It
can be front-loaded or side-loaded, depending on the land on which it’s putting
it. They can decide the number of rooms.”
Development in India
BWH
also expands internationally, especially in India, by partnering with New
Delhi-based Sorrel Hospitality, the company’s master licensee. Cuculic said BWH
currently has over 50 hotels open or in the pipeline in India and has asked
Sorrell to increase that number.
“We’ve
asked them to accelerate their growth because we think that is a tremendous
opportunity,” he said. “There is, we believe, strong potential to grow in what
we would traditionally call secondary markets. [Sorrel’s] growth has been in
the large urban areas, and they will grow outward into secondary markets as
that infrastructure is developed.”
Cuculic
said the number of BWH hotels in India could “easily double” in two years.
“We have to get to 100, and then from there, you get to 150, and then you continue
to grow it,” he said.
Customer journey
Cuculic
said the biggest challenge in hospitality is meeting guests’ evolving needs.
You have to think about what today’s travelers are looking for, not what they looked for before.
Larry Cuculic
“You
have to stay attuned to those expectations and then exceed them,” he said. “You
have to think about what today’s travelers are looking for, not what they
looked for before.”
Here,
Cuculic mentioned the “customer journey,” which he thinks will be a huge driver
of success in the future.
“I
don’t look at it as a challenge, but I look at it as the opportunity of guest
expectations evolving across the customer journey,” he said.
Cuculic
said that the journey could include the entire cycle of how guests view
marketing campaigns and how BWH interacts with them from booking through
post-stay.
“You
want your guests to be ‘sticky’ throughout that process,” he said. “Things are
changing pretty quickly, and we as an industry and as a company need to evolve
throughout that customer journey.”